Concerns about how to divide reduced "bread"
Ms. T.B.N (Ho Chi Minh City) said that she is very interested in the method of calculating house rental tax according to new regulations applied to the 2026 fiscal year.
Assuming the total rental revenue in the year is 900 million VND, this reader wonders if it is possible to deduct 500 million VND of "tax exemption" for both taxes (VAT and PIT). Specifically, reader N. understands that the taxable income will be 400 million VND (900 - 500), and the tax payable is 40 million VND.
In particular, in the case of this 900 million VND coming from 02 different houses (each house worth 450 million VND) located in two different wards, reader N. is confused and does not know how to declare to enjoy this 500 million VND deduction: "How should I allocate this 500 million VND deduction to each additional tax code of each house?".
Great difference between VAT and PIT calculation methods
To answer this question, Basic Tax 11 (Ho Chi Minh City) has guidelines based on the Value Added Tax Law No. 149/2025/QH15 and the Personal Income Tax Law (amended). The most notable point is the different determination of the amount of tax payable between the two types of taxes.
1. For Personal Income Tax (PIT): Only calculated on the portion exceeding. Based on Clause 4, Article 7 of the Personal Income Tax Law, individuals leasing real estate pay PIT determined by the portion of revenue exceeding 500 million VND multiplied by a 5% tax rate.
For example: With revenue of 900 million, PIT = (900 million - 500 million) x 5% = 20 million VND.
2. For Value Added Tax (VAT): Calculated on total revenue differing from PIT, regulations on VAT do not mention deducting 500 million VND before tax calculation. Specifically, in case an individual has a rental income of 900 million VND/year (larger than the 500 million VND level as prescribed), they are subject to VAT. The amount of tax to be paid is determined according to the direct calculation method of 5% multiplied by revenue.
For example: With revenue of 900 million, VAT = 900 million x 5% = 45 million VND.
The tax-free revenue level of 500 million VND is the new revenue threshold (instead of 100 million as it is now). Below this level, people do not have to pay taxes.
No guidance on allocation procedures yet
Regarding the question "how to divide the deduction of 500 million VND for 2 houses in 2 different places", the tax authority said that there are currently no specific instructions.
Because Article 13 of the Law on Tax Administration No. 108/2025/QH15 and related regulations take effect from January 1, 2026, the Ministry of Finance will issue detailed guidance documents on dossiers, procedures for allocation and declaration in the coming time.
Taxpayers need to proactively monitor the Decrees and Circulars to be issued soon to correctly apply the declaration process for the 2026 fiscal year.
